Wednesday, December 31, 2014

Andrew Coyne ends the year with a surprising -- for him -- admission. When it comes to a contest of ideas, he writes, the Left is winning:

It wasn’t until late in the year that it dawned on me: the left is
winning. I don’t mean this in a partisan sense. If the NDP represents
the left, it had a terrible year, fading in the polls federally, turning
in a miserable showing in the Ontario election and losing two mayoral
races, in Winnipeg and Toronto, it had earlier been favoured to win.

But
in the contest of ideas, the left is very much on the march. Kathleen
Wynne won the Ontario election on an aggressively left-wing
budget/platform that not only increased spending, taxing and borrowing,
but proposed the first major addition to the social safety net in
decades: the Ontario Retirement Pension Plan.

Elsewhere there are
serious proposals on the table for a national daycare plan, a national
pharmacare plan, a surge in spending on urban transit and other
infrastructure. The left is doing all the running on the environment,
where it is no longer taboo to talk about carbon pricing. Identity
politics, with its obsessive focus on race, sex and class, dominates
public discourse.

He does not come to this admission happily. But he does admit that the Right in Canada -- like their Republican brethren south of the border -- have become the Party of No:

The most the right will allow itself is to oppose this or that proposal
to expand the state (when it is not proposing them itself: see
“cross-border pricing,” inter alia), once it has assured itself it is on
safe ground politically to do so. Occasionally it will even go so far
as to roll back a policy that has already been enacted.

However true Coyne's observation might be, it does not mean the Left will win the next election. The Right does not deal in ideas. It deals in fear and smear.

Something to think about in the New Year. May everyone have a happy and healthy one.

Tuesday, December 30, 2014

Our prime minister believes that "no taxes are good taxes." He simply parrots what has been the conventional wisdom for the last forty-five years. But, Alex and Jordan Himelfarb write, the conventional wisdom is failing:

According to the
government’s own figures, federal revenue as a share of the overall
economy is hitting lows not seen for 70 years. Cash-strapped governments
behave as we all do when money is tight, cutting corners and focusing
on getting through the day rather than investing in the future — even
when this short-termism ends up costing far more down the line. We see
this, for example, in crumbling infrastructure as governments put off
necessary investments, increasing risks to health and safety,
undermining competitiveness and passing on even higher costs to future
generations.

We see this as well in
the increasing concentration of income and wealth and persistent
poverty as tax cuts weaken the programs that reduce inequality and
mitigate its consequences — from child care to medicare. Today, fewer
unemployed Canadians than ever have access to EI, this at a time when
our labour market performance has been particularly shabby. Twenty-five
years after our Parliament committed to ending child poverty,
shamefully, things are actually worse. And perhaps most worrisome, we
start to believe this is all normal and inevitable. Little wonder that
trust in government continues to decline and more Canadians are asking
whose interests government serves.

Now organizations like the IMF and the OECD are arguing that inequality impedes economic growth:

Over this past year, however, some unexpected voices have started to
talk about taxes not as a burden, part of the problem, but as a key part
of the solution to our challenges. Even some organizations that have
always embraced and promoted the low-tax austerity agenda have started
to wonder out loud whether this has all gone too far. The IMF, the OECD,
bond rating agency Standard and Poor’s — past champions of austerity —
have all published reports this year making the case that the costs of
tax cuts now outweigh whatever benefits they were supposed to deliver.

For an economist, Stephen Harper remains breathtakingly ignorant of the latest work in his field. He will run in the next election on a platform of family friendly tax cuts. The myth that he is a smart fellow -- like the conventional wisdom -- is failing.

Monday, December 29, 2014

Robin Sears is a past master of political strategy. In this morning's Toronto Star, he offers strategic advice about how each of our three main leaders should approach the next election. Stephen Harper, he writes, will not be able to get by on his economic credentials:

They are, as analysts would say, already “priced into his stock.” He is
facing real opponents for the first time in his life, apart from the
late Jack Layton explosion in 2011 that almost overwhelmed him. Trudeau
may not look like a statesman but neither is he the gormless Stéphane
Dion or the unbelievable professor who “did not come back for you.”
Mulcair has amply demonstrated that in street-fighting credentials
Harper has met his match.

Harper needs to pivot from previous dead ends and demonstrate that he
can learn and adapt. He should make selections from a suite of softer
game-changers: a new honesty on climate change, a program on employment
and integration for Canada’s vets that admits past failures, a
believable job creation platform focused on the young and new Canadians
that is not simply more blather about tax cuts, even an acknowledgement
of his missteps on First Nations and a package on education and economic
development would stuff one of the orange and red teams’ most damaging
attack lines.

Stranger things have happened. But I wouldn't bet on Harper taking Sears' advice.

Justin Trudeau is caught in a bit of a vice:

He will be fighting a
war on two fronts. He is the greenhorn against two tough and seasoned
pros, each of whom has signalled that they will deploy their artillery
against him from different sides of the battlefield.

He does have an
energized and united party for the first time in a generation. But it is
now 35 years since the Liberals have won a majority of Francophone
votes let alone seats in Quebec. It is twice as long since they have won
more than a dozen seats between Toronto and the Rockies. Redistribution
may give them gains of ones and twos in several western cities.But
Trudeau will need to move nearly 100 new seats into the win column for a
majority, a swing achieved only twice in the past century.

He needs a galvanizing
vision similar to his dad’s. In his first campaign Pierre Trudeau sold
sex appeal, a contest in which his son has amply demonstrated his chops.
But Trudeau the elder also sold a vision of a more global, confident
Canada, a modern compassionate leader on the world stage. It matched
perfectly the centennial bonhomie of a new generation of Canadians.

So far, we've seen no vision from Trudeau the Younger.

Then there is Mulcair, who has a wealth of political experience. But what he lacks are "big commitments:"

Mulcair needs to demonstrate his economic savvy, buttressed by his green
credentials with a believable climate change and economic development
message. He needs to round out his social justice message to arrest soft
progressives’ drift to the red team. The national minimum wage and
universal child care planks were good beginnings. He needs big
commitments on environment, First Nations, youth employment, education
and pension reform to block Mr. Trudeau.

Sears seems to have carefully sized up each man. One wonders if any of them are listening to him.

Sunday, December 28, 2014

On the second anniversary of the founding of the Idle No More Movement, Irvin Studin writes:

There can be little
doubt that the aboriginal question is by far the most important moral
question of Canada’s early 21st century. No other public question in
Canada has its historical weight, inertia and complexity.

But what is the
aboriginal question for this century? Are we talking about standards of
material well-being for aboriginal people? Is it about social status and
professional opportunity? Or does the question turn fundamentally on
the vindication of specific legal and constitutional rights?

The answer must begin
with the brutal premise that the aboriginal people in Canada still live
as history’s losers; that is, most of the aboriginal people in Canada
are descended most recently from people who in their legal, social,
economic, organizational and geopolitical interactions with
non-aboriginals — principally European settlers and their own
descendants — were over time and for a variety of reasons stripped of
territory, prestige, rights and the underpinnings of social and material
well-being.

The answer must also take note of the fact that the government which tore up the Kelowna Accord has done nothing to advance the well being of Canada's native peoples. If anything, the Harperites have moved to ensure that Canada's First Nations remain trapped in and enslaved by a long history:

To this day, the aboriginal people have generally not been relieved — in
their own minds or in the minds of the winning majority — of the status
of Canadian history’s losing people. This is not a merely formal
status; it is a properly psychological-spiritual one. It means that to a
large extent the negative drag of the aboriginal question today
continues to be psychological-spiritual in nature, and that a good part
of the answer to the aboriginal question must deal frontally with this
reality.

Studin writes that French Canadians used to be seen as a conquered people. The Quiet Revolution changed that perception -- for both French and English Canadians:

The creation over time in Canada of a properly bilingual, bicultural and
binational state points the way forward on the aboriginal question.
Canada’s great success in responding to the challenge to internal unity
and cohesion posed by the linguistic and cultural differences between
the English-speaking majority and the French-speaking minority has been
premised on the idea that the endgame consists not in perfect harmony or
amity between the tribes, but depends instead on how a historically
victorious majority can rehabilitate and resuscitate defeated minorities
into political and even cultural co-equals — co-equals who are equally
invested in the continued existence of the state.

That change, of course, presumes a generosity of spirit -- something that is missing in the Harperite DNA. If Canada's native peoples are ever to take their place in the national firmament, the Harper government will have to be removed from its place in that firmament.

Saturday, December 27, 2014

Stephen Harper passed his best before date long ago. If he paid attention to history, he would have misgivings about running in the next election. Jeffrey Simpson writes:

Think of the prime ministers with majorities since 1968. Pierre Trudeau
served 11 years (1968 to 1979) before being defeated. Brian Mulroney
served a bit less than nine years before resigning. Jean Chrétien was
prime minister for 10 years and a month before resigning.

But, in our first past the post system, all Harper needs is 40% of the votes to form a government:

He has an unshakable core vote of 30 to 32 per cent of the
electorate. These people skew older, rural, male, western Canadian – and
they vote. The Conservatives know how to mobilize them.

They have
also identified minority groups – Jews, Tamils, Ukrainians – and tied
Canadian foreign policy to the interests of these slices of the
electorate. They have large amounts of government money in the form of
tax cuts and government advertising to direct at other slices of the
electorate: single-income families with stay-at-home mothers, parents
with kids in athletic programs. And they have a large series of targeted
spending announcements yet to be made, on top of the dozens and dozens
already made.

It's an entirely cynical approach to politics. And Stephen Harper isn't the first politician who got to where he is by being entirely cynical. But when the people themselves get cynical about their leaders, those leaders go down to defeat:

The most powerful anti-government sentiment in any democracy is the
oldest adage in politics: “Time for a change.” The economy can be
reasonably sound, the political alternative untried, even shaky, the
government experienced and able, but when the largest parts of the
public settle on the ill-defined but powerful notion that the time has
come to change, there isn’t much the incumbents can do.

Harper is betting that Canadians haven't reached that point yet. 2015 will test just how cynical we have become.

Friday, December 26, 2014

As we enter 2015, the world faces a Pandora's Box of problems. Daryl Copeland writes:

Thanks to the emergence of the Islamic State in Syria and Iraq, the
much-maligned Global War on Terror (GWOT), which only a year ago seemed
to be waning, has received an enormous boost. The name may have changed,
but terrorism and radical Islam remain at the top of the threat list
for most Western governments. While large-scale invasions and
occupations have — for now — fallen into well-deserved disrepute, that
space has been filled by a combination of drone and airstrikes, special
operations, cyber attacks and mass surveillance.

Long-standing concerns over Russia’s stability and the security of its
enormous nuclear arsenal have been exacerbated by the resurgence of
revanchism in Crimea, eastern Ukraine and throughout the “near abroad.”
The ongoing economic meltdown engendered by the oil price collapse has
amplified the sense of volatility and uncertainty.

When the distribution of wealth within and between states becomes
sharply skewed, economies and people suffer. This was the core message
of the Occupy Wall Street campaign, and although that observation has
since become mainstream, polarization continues. Meanwhile, last week’s round of climate change negotiations in Lima produced little, despite the findings of the latest — and highly troubling — IPCC report.
Similar paralysis has afflicted efforts to remedy problems of
diminishing biodiversity, resource scarcity, public health and pandemic
disease, and other planet-imperilling issues rooted in science and
driven by technology.

Canada used to play an important role in international diplomacy. No longer:

What of this country’s
role and place? By my reckoning, Canada’s once-admired internationalist
brand has been spoiled, mutating into something of a cross between
warrior nation wannabe and fossil of the year. We have foundered on the shoals of lessons unlearned — think Afghanistan and Libya — and moved decisively to make matters worse.

After wisely passing
on joining the disastrous misadventure in Iraq in 2004, Canadian Air
Force and army personnel are now engaged, thus reversing earlier gains
and creating new enemies by effectively signing on to GWOT II. On the
home front, many NGOs are struggling due to the withdrawal of government
support. Rights and Democracy, chartered by Parliament in 1988 to
promote human rights and democratic development worldwide, was
eliminated in 2012. The Pearson Centre for peacekeeping training was
shuttered in 2013. The development research dedicated North-South
Institute was closed down earlier this year.

Stephen Harper has done all kinds of damage to this country. And that damage is spreading out to the rest of the world. If we are going to re-establish our international prestige, 2015 must be the year we throw the Harperites out of office.

Wednesday, December 24, 2014

"Peace On Earth." We repeat the phrase often at this time of year. It's standard boilerplate -- a postive suggestion, but not very likely. However, Paul Krugman wrote this week that there are realistic reasons to support the suggestion. Those reasons have been around for awhile:

More than a century has passed since Norman Angell, a British journalist
and politician, published “The Great Illusion,” a treatise arguing that
the age of conquest was or at least should be over. He didn’t predict
an end to warfare, but he did argue that aggressive wars no longer made
sense — that modern warfare impoverishes the victors as well as the
vanquished.

Krugman believes there is plenty of evidence to suggest that Angell was right. Iraq and Afghanistan stand as sad examples of the fact that the spoils of conquest are no longer what they used to be. And Vladimir Putin's recent empire building offers more evidence that conquest no longer pays:

Look at what passes for a Putin success, the seizure of Crimea: Russia
may have annexed the peninsula with almost no opposition, but what it
got from its triumph was an imploding economy
that is in no position to pay tribute, and in fact requires costly aid.
Meanwhile, foreign investment in and lending to Russia proper more or
less collapsed even before the oil price plunge turned the situation
into a full-blown financial crisis.

So what does the evidence tell us about the guys who keep insisting they're the smartest guys in the room?

Let’s
not forget how we ended up invading Iraq. It wasn’t a response to 9/11,
or to evidence of a heightened threat. It was, instead, a war of choice
to demonstrate U.S. power and serve as a proof of concept for a whole
series of wars neocons were eager to fight. Remember “Everyone wants to go to Baghdad. Real men want to go to Tehran”?

The
point is that there is a still-powerful political faction in America
committed to the view that conquest pays, and that in general the way to
be strong is to act tough and make other people afraid. One suspects,
by the way, that this false notion of power was why the architects of
war made torture routine — it wasn’t so much about results as about
demonstrating a willingness to do whatever it takes.

Christmas isn't about doing whatever it takes. It's about doing for others not to others. Merry Christmas to all. Perhaps next year there will be more peace on earth.

Tuesday, December 23, 2014

The Harperites like to present themselves as advocates for law and order. But, Errol Mendes writes in the Globe and Mail, they do their best to undermine the rule of law. Consider their taxpayer funded propaganda machine:

Governments are allowed to advertise about services and programs that
they are implementing, but when some of them are either untruthful,
promote partisan positions or are not even authorised by Parliament, it
becomes a vehicle to undermine the foundations of any democracy that
values the spirit and letter of the rule of law.

Dalton McGuinty was no Boy Scout. But he realized that government advertising could be used for blatantly partisan purposes:

The McGuinty government brought in rules that requires all government
ads to be reviewed and passed by the auditor-general. The holder of that
office has the ability to stop clear partisan ads being funded by the
taxpayer.

There is no such mechanism at the federal level:

The present national ads for the family benefits tax package
would have been stopped dead in their tracks if we had a similar
screening process of government ads at the federal level, especially
given that they were not even passed by Parliament.

And Stephen Harper has devoted much of his energy to making sure that no such mechanism materializes:

Even back in 2000, while heading up the National Citizens Coalition, he
launched court actions against the spending limits of third parties
under the Canada Elections Act. With a challenge that seemed to ignore
the need for ensuring electoral fairness, his conservative advocacy
group used the argument of citizens’ freedom of speech to ask the courts
to strike down limits on third-party funding beyond a $150,000 limit
during the election campaign. He failed when the Supreme Court lectured
him and his group that the law was needed for electoral fairness and a
level playing field in order to prevent certain groups or individuals
from dominating the media and the electoral process.

Now in government – and outside the electoral period – Mr. Harper has
found a way for his government to flood the media with partisan
propaganda to the tune of hundreds of millions of our dollars. If such
democratic subterfuge has the same effect of unfairness before an
election, then the Harper government is clearly undermining the spirit
of the rule of law critical to fair elections. He has, in effect, made
the government a third party that is allowed to spend potentially
millions of dollars, making the actual limits in the election period
illusory to some extent.

Empty barrels always make the most noise. And dictators love to pose as democrats.

Monday, December 22, 2014

Michael den Tandt writes that the political narrative in Canada over the next year will be all about what Justin Trudeau does. That's because -- for better of for worse -- Trudeau has assumed the mantle of the mythic hero:

Trudeau’s popularity could be linked to the very fabric of how human
beings perceive political narrative. His brand has been crafted,
deliberately it seems to me, to tap into very old archetypes of heroism.
These archetypes are everywhere in our culture – in film, literature,
myth and politics.

Joseph Campbell called it the mono-myth. It’s
also been described as “the hero’s journey.” A young warrior appears,
often of secretly noble parentage. He or she is called to adventure,
initially refuses the call, but eventually yields to destiny, to take up
the mantle and burdens of leadership. George Lucas’s character Luke
Skywalker, of course, was built around this meta-story. So were the
tales of the Lion King, and numerous other Hollywood fables.

Perhaps den Tandt is going a bit overboard. But he points out that:

Trudeau’s policy deficit has been presented as his
greatest problem. It really isn’t. Though the lack of hard platform thus
far has caused him some discomfort, the waiting does have one benefit:
The Liberals will have the last word. It is safe to assume that, at some
point between now and October, Trudeau will unveil a detailed plan to
address income inequality and high household debt among the middle
class. It is also safe to assume this plan will be framed as more
egalitarian than the Conservatives’ income-splitting plan, and more
realistic and responsible than the NDP’s ideas. The policy gap, in other
words, will be filled.

What’s more
intriguing, and potentially dicey for the Liberals, is the relentless
pressure on Trudeau to live up to what I have heard jokingly described
as his “Skywalker brand.” It’s actually no joke. The framing of a leader
in Arthurian terms, as a good-hearted young hero, is inherently risky,
because it makes it incumbent on that leader to live that part, and
continue living it.

The problem with the Arthur fable was that -- in the end -- it all came crashing down. Only time will tell if Trudeau can rebuild the Round Table.

Sunday, December 21, 2014

The word "terrorist" is everywhere these days. But, Tom Walkom writes, the definition of the word depends as much on domestic considerations as it does on international considerations. And domestic considerations change -- frequently:

Take the most basic
question: Who are the terrorists? Until Wednesday, Cuba was listed by
the United States as a state sponsor of terrorism. Now U.S. President
Barack Obama says it is not.

Why? It’s not because Cuba has changed. It’s the same old place. Raul and Fidel Castro are still in charge.

Rather it is because American domestic politics have changed. Now it’s politically useful for Washington to bury the hatchet.

Is Hamas itself
terrorist? Canada says yes. The European Union’s second highest court
says maybe not. The General Court said the EU used improper methods to
place Hamas on its terror list.

And, in the lead up to an election, the word "terrorist" becomes a hot button:

For more absurdities,
look at Prime Minister Stephen Harper’s air war against the Islamic
State.

According to Ottawa, it is part of an epic battle for the future
of civilization. Yet in almost 50 days of warfare, Canadian fighter jets
have released their bombs only nine times.

In part, this is because the U.S.-led coalition can’t find enough enemies of civilization to bomb.

But in part, it
results from the disjunction between the rhetoric surrounding this
conflict and a more mundane reality — which is that Harper needs a war
to win the next election, but he needs it to be a war with few Canadian
casualties.

Last week, both Peter Mackay and Stephen Harper suggested that the murderers of two Canadian soldiers might be connected to ISIS. To date, no evidence of that connection has emerged -- just as those "weapons of mass destruction" in Iraq never materialized.

So whose terrorist are we talking about? A real one -- or one manufactured for political gain?

Saturday, December 20, 2014

Parliamentary government is rooted in a series of conventions. The problem, Andrew Coyne writes, is that our political parties are no longer paying attention to those conventions. And if -- as seems likely -- we elect a minority government the next time around, what, he wonders, will happen in the wake of no political consensus:

We are notably lacking in consensus in this country on even the most
basic rules of the game. We flirted with an all-out constitutional
crisis on more than one occasion then. The next time we might not be so
lucky.

Suppose, for starters, the Conservatives win a plurality of the seats
in the election, and suppose, as seems likely, they are defeated in the
Commons shortly thereafter on a matter of confidence: the Throne
Speech, for example. What then? Would the prime minister go to the
governor general and demand that he dissolve the House, triggering
another election so soon after the last?

Would the governor general be obliged to do as he was told, or could
he call upon some other party, perhaps even a coalition, to try to form a
government? Mr. Harper has been adept at presenting this as dirty pool,
an attempt by “the losers” to steal the election. Traditionalists like
me insist that’s precisely how our system is supposed to work. We do not
elect governments in this country: we elect Parliaments. The prime
minister is whoever commands the confidence of the House, full stop.

All three parties now operate on the principle that we elect leaders, not parliaments. And it appears that most Canadians think that's the new convention. What happens when the conventional wisdom no longer applies?

Friday, December 19, 2014

Stephen Harper has made no secret that it is his intention to transform Canada into a petro-state. Stanford professor Terry Lynn Karl has devoted her academic career to the study of petro-states. And she has concluded that petro-politics lead to self immolation. In an interview with Andrew Nikiforuk, she predicts that falling oil prices will have catasrophic consequences for several petro-states:

"The effects of falling oil prices will be quickly felt in Venezuela,
which is extremely vulnerable. If oil keeps dropping, the country's
employment, standard of living and GDP will be affected. This tends to
make people not like their government.

"Venezuela, which is already extremely
polarized, is in big trouble. In this respect, there is a big
difference between how oil prices affect Canada and the U.S. and how
they affect countries where the politics have become totally petrolized.
Where there is simply no difference at all between wealth and power,
where corruption and rent seeking have taken over the whole enterprise
or where conflict is already very high, these are the most vulnerable
countries.

Russia isn't quite as vulnerable as Venezuela, but because it is a
global power its fate is more important. In the face of both sanctions
and low prices, the ruble has plummeted, debt is rising, living
standards are declining, and food prices are up sharply. With oil prices
high, Putin took certain actions in the Ukraine and elsewhere because
he felt untouchable; his popularity remains very high.

"But this could change very quickly if prices remain low.

"Most people don't understand that the
decline of the former Soviet Union was closely linked to the 1986
collapse in oil prices. Putin later took advantage of high prices to
build his own personal power. That could be at stake if prices stay
low."

And for all petro-states:

"Debt is the Achilles heel of this picture. If prices remain low for
several years, a lot of U.S. shale producers have high debt loads,
especially in junk bonds. Today, energy debt currently accounts for a
substantial 16 per cent of the U.S. junk bond market. If these producers
start going bust, investors in junk bonds will be in for a shock.

"Dropping oil prices affect international debt as well, creating a high
risk of default by countries like Venezuela. Around the world two sets
of debt are coming in -- from the high cost bitumen and shale oil
producers who borrowed to help create the current supply glut and oil
exporting producers who have borrowed heavily. Both affect the entire
financial system.

So, just as the financial system almost brought the house down in 2008, oil could be the cause of the next global economic collapse. And Stephen Harper happily assumes oil will lead to national Nirvana.

Thursday, December 18, 2014

Canadians were appalled when the U.S. Senate report on torture saw the light of day. We like to think, as John Baird said, that "Canada doesn't torture anyone. Period. Period." But, like everything that comes out of the mouths of this government, that's a half truth. Linda McQuaig writes:

The Harper government has opened the door to Canadian complicity in torture. It issued a directive
allowing Canadian officials to share intelligence with foreign
governments in some situations, even when this could lead to torture or
to the receipt of information extracted under torture.

But like so many other disgraceful things that this government has
done, the Harper crew issued this directive secretly; it only came to
light through the access to information law.

Rather than simply prohibiting Canadian government agencies from sharing
torture-tainted information, the Harper government’s directive simply
requires approval from higher-ups, specifying that the matter should be
referred to the appropriate deputy minister or agency head.

And, given the fact that "higher ups" either fall into line with this government or are fired, that protection means nothing. The goal is to get the information and let others do the torturing -- which is precisely what happened with Maher Arar. Justice Dennis O'Connor rejection of that policy was scathing:

In his powerful report,
Justice O’Connor found that the RCMP’s false information likely had
contributed to Arar’s year-long ordeal in Syria, and recommended
Canadian agencies never send foreign authorities information that could
lead to torture.

That recommendation led the RCMP to revamp their information-sharing procedures.

O’Connor’s report went further and condemned torture under any
circumstances, noting that the prohibition against torture in
international law is so fundamental it has acquired the status of jus cogens — a body of “higher law” that overrides all other laws or government practices.

But the Harperites' secret directive, in effect, eviscerated O'Connor's specific recommendations. Should we be surprised?

Wednesday, December 17, 2014

Scott Clark and Peter DeVries ask the question the majority of Canadians are asking:

Why do the Conservatives govern the way they do? Why do they treat so
many Canadians with such … contempt? Aboriginals, immigrants, children,
disabled and minorities — all have been pushed aside. Not-for-profit
groups and associations have been deprived of the resources they need to
contribute to the economic, social, scientific, environmental and
cultural well-being of the country.

This government loves power but hates government. And it has a plan:

The plan is, actually, quite simple — when you remember that these
Conservatives came to power not to praise government, but to bury it.
This is an administration committed to reducing the size and relevance
of the federal government (not counting advertising and PR staff, of
course). Since 2006, federal programs and services have been cut
dramatically — not to serve the short-term needs of budget austerity,
but to fulfill a conservative quest for the smallest government possible
… “down to the size where we can drown it in the bathtub,” to borrow a
phrase from American arch-libertarian Grover Norquist.

Government can actually be quite effective. And it wouldn't take much to make the federal government much more effective. Scott and DeVries offer a modest proposal:

Suppose the government increased the GST by one point. What would
that do? Well, the cost of a $100 product or service would go up by …
one dollar. Ten cents on a $10 dollar purchase. The cost of a pack of
gum might go up by a penny (there aren’t any pennies any more, but you
get the point).

What would that do for the federal treasury? It would raise about $8
billion every year. That’s a lot of money for veterans services, for
badly-needed infrastructure, for everything we’ve been neglecting. And
it still amounts to just .04 per cent of GDP.

They won't do that, of course. Making government more effective would destroy their raison d'etre. That would make no sense at all.

Tuesday, December 16, 2014

After the latest EKOS poll, there has been a lot of talk about a Liberal-NDP coalition. Frank Graves claims that's what the majority of Canadian voters want. But, Chantal Hebert writes, that's not what the two respective party leaders want:

This fall, their
mutual obsession with each other has tended to blind them to other
big-picture considerations with posturing and positioning regularly
taking precedence over the fight against a common Conservative foe.

Think of Justin Trudeau’s opposition
to Canada’s combat role in the international coalition against Islamic
State extremists. It ran counter to the advice of some of the party’s
brightest foreign policy minds and it was poorly articulated but it did
offer the Liberal left flank some cover from the NDP.

Or think of Mulcair’s
out-of-the-blue musings about a resuscitated federal gun registry. He
may have hoped to score points against Trudeau but he mostly ended up
bringing long-standing NDP divisions back to the surface.

Think finally of the
reciprocal suspicions that attended their handling of the delicate
matter of the alleged sexual misconduct of two male Liberal MPs against
two of their female NDP colleagues.

The days are long gone when Liberals, under Louis St. Laurent, thought of Dippers as "Liberals in a hurry." And Stephen Harper knows that. In fact, he's counting on the new Dipper-Lib rivalry to keep him in power.

And, unless Mulcair and Trudeau can learn to talk to each other, Mr. Harper will get his way.

Monday, December 15, 2014

Newfoundland Premier Paul Davis was not happy after his meeting last week with Stephen Harper. "It really solidifies that you can’t trust the federal government, you
can’t trust Stephen Harper’s government," he said. "We bargained in good faith. We
believed that we had an agreement in place, that we had a deal set."

Former premier of Newfoundland and Labrador, Danny Williams, once
believed he had a deal that would allow his province to keep its
offshore oil revenues while still being eligible for full equalization
payments from Ottawa. When Stephen Harper changed that arrangement,
Williams went on the war path. With the full backing of the premier’s
office, word spread across Newfoundland and Labrador — vote for anybody
but Harper at the ballot box.

And then there was Harper's alteration of the Atlantic Accord. When Bill Casey met with Harper, he discovered that the agreement meant what Stephen Harper said it meant:

Casey visited the prime minister personally, armed with legal
opinions from the justice department confirming that the deal had been
changed and that it was illegal.

“Harper swept the opinions off his desk and said that the words meant
what he said they meant. He said that I had never been with the
program,” Casey told me.

Jack Layton said he discovered early on that you couldn't take the prime minister at his word. That, Harris writes, is what the next election will be all about: Stephen Harper's word.

Sunday, December 14, 2014

Joe Oliver is meeting with his provincial counterparts today. Kevin Page writes that, given Canada's and the world's economic outlook, it's time to ask some tough questions:

Some of these issues
cannot be ignored any longer. For instance, will any provincial or
territorial finance minister confront Joe Oliver, their federal
counterpart, about income stagnation? Data on Human Resources and Social
Development Canada’s site shows that median after-tax incomes for all
families (or real GDP per capita) has been virtually flat since 2007.
Debt feels very heavy when incomes are stagnating.

Or what about income
inequality? The New Canadian Income Survey on the Statistics Canada
website shows that 4.7 million people or 13.8 per cent of our population
lived with low income in 2012 (income less than half of the median of
all households). That is a troubling number that should worry all
Canadian political leaders.

Our finance ministers are smart. They know that faster growth is going
to require higher investment rates and sustainable public finances. But
the reality is that Canada is falling down on capital investments in
both the private and public sectors.

That's because the ruling orthodoxy these days dictates that the only way to encourage investment is to cut taxes:

Why do we continue to
pursue an approach that stunts growth now and for the future? Is this
public sector mismanagement? Or, is this an effort to achieve a balanced
budget that allows for spending on current goods or services (for my
generation that votes) at the cost of capital goods for future
generations (our children and grandchildren that do not yet vote)?

And what about
infrastructure spending? Will the ministers confront Oliver about the
2013-14 Public Accounts for Infrastructure Canada, which show the
federal government is not getting planned transfers on infrastructure
out the door. Last year, $640 million was left unspent on a range of
infrastructure programs. What will this mean for future Canadians?

The austerity approach
set out in the 2012 federal budget will succeed in generating a
balanced budget, but at a cost: slower growth and degraded public services
like support for veterans. Meanwhile, the government is responding to
its improved fiscal situation not by raising the investment rate, but by
cutting taxes further.

Page got into trouble because he questioned the Harper government's orthodoxy. Time has proven, however, that Kevin Page knows a lot more about economics than Stephen Harper does.

Friday, December 12, 2014

Stephen Harper came to Ottawa claiming that he was a righteous man. He stood, he said, for the truth. But, Michael Harris writes, with Harper it's never been about the truth. It's been about advertising -- and he arranges for Canadians to foot the bill:

We’re living in the age of propaganda politics financed by the public
between elections; appearance and reality are now separated by light
years of marketing BS. As the PM postures as the veterans’ champion, his
government has quietly agreed to transfer to Quebec the last Veterans
Affairs hospital in Canada run by the feds. It hasn’t been announced
yet, but Quebec’s health minister, Gaetan Barrette, listed St. Anne’s
Hospital in the Law Number Ten Project, merging the federal facility
with other establishments in Montreal’s West Island.

The veterans affairs fiasco is a particularly egregious example of how advertising has replaced the truth:

It’s nothing of the sort, of course. In fact, it’s more tarnished than
ever. The Harper government has fired thousands of VA staffers and are
hiring dozens. There is no information on how these new front line
workers will be deployed. There never is any detailed
information in Harper “news” releases; he saves that for information
leaks about his enemies, like Helena Guergis or Jim Prentice.

And the Harperian propaganda surrounding the F-35 was equally putrid:

Remember all the marketing attached to this file? The PM confabulating
that there was a contract when there was no contract. The PM saying the
price was $16 billion for sixty-five F-35s; it was $10 billion higher
and cabinet knew it. The PM saying the parliamentary budget officer was
wrong on his numbers; it was the PM who was wildly, consciously wrong.
The Auditor General finally put the Cons out of their misery by
completely backing up Kevin Page.

Joan Mellen wrote that Lillian Hellman was the:

foremost literary fabulator of her
generation. Lillian Hellman invented her life, so that by the end even
she was uncertain about what had been true.

Hellman's and Harper's politics were diametrically opposed. But they shared a fatal flaw.

Thursday, December 11, 2014

The Big Lie of the last forty-five years has been Trickle Down Economics. The Great Depression exposed it as a Big Lie. But people have short memories and -- at least until recently -- they've bought the lie for a second time. The OECD, however, has exposed the trickle down lie for a second time. Linda McQuaig writes:

Essentially, the OECD report reveals the immensity of the
trickle-down scam, which the report shows has not only failed to foster
economic growth as promised, but has proved to be an overall killer of economic growth.

And the report puts actual numbers on how much growth has been
reduced as a result of trickle-down. In the case of Canada, the reduced
economic growth amounts to about $62 billion a year — which economist
Toby Sanger notes is almost three times more than the estimated annual loss to the Canadian economy of lower oil prices.

All along there have been contrarian voices:

Meanwhile, there was mounting evidence — advanced by Joseph Stiglitz,
Paul Krugman and other high-profile liberal economists — that neoliberal
policies did little more than the obvious: making the rich richer, with
no benefits for anyone else.

Now the economic powers that be have caught up with Stiglitz and Krugman:

With its report this week, the Paris-based OECD has gone farther
still, stating unequivocally that its research shows that policies
favouring the rich haven’t just failed to create overall economic
growth, they have actually “curbed economic growth significantly.”

This drag on economic growth, the OECD explains, results largely from
those lower down the income scale — including the bottom 40 per cent of
earners — lacking the funds to invest in their own education.

The Harper government, however, has no interest in the OECD's research. They've already been bought and paid for.

Wednesday, December 10, 2014

Generational conflict awaits Canadians -- unless the young are brought into the political process. And Franks Graves' latest polling suggests that is not happening. Graves reports:

Among younger Canadians there is clear sense that the playing field is
tilted to favour older voters. This perception may be grounded in harsh
realities about how the economy, our democracy and our public
institutions are performing. The youth vote is increasingly irrelevant
to the business of winning elections — so political agendas tend more
and more to reflect the wishes and fears (both real and imagined) of
older Canada. This, in turn, may be leading to the permanent political
disengagement of the young — who increasingly see a political process
that doesn’t reflect their needs, their concerns and their ethics.

The Harper government has focused its pitch solely on baby boomers, whereas the children of the boomers have been forgotten.The gap between them and their parents is profound. The young are:

much more ethnically and culturally diverse — and more educated
— than previous generations. They grew up in a digital climate and are
completely at home with modern information technology. Their social
values are highly progressive — but they suffer from being the first
post-war generation that failed to benefit from the middle class
covenant of intergenerational progress. They’re entering their peak
years of economic influence and they’re raising families now — but they
will never have the political and market clout enjoyed by the boomers
that preceded them, and will be shoved to the side by the larger echo
boom of Gen Y and millennials now coming of age.

And the Gen Y folks are even more distant from the present government's agenda. Together with the GenXer's, they don't buy any of the Harperian prescriptions for this country:

They are extremely progressive in their social values; the small-c
conservative values of hard work, self-reliance, traditional family
values and respect for authority are basically meaningless to this
generation. They’ve entered a stagnant and unequal economy and their
futures look much less bright than those of their parents at the same
stage of life. They’re deferring the usual rites of passage — starting a
career, marrying, building a family — further and further into the
future.

So what is the Harperian plan to deal with the young? Turn them off and keep them turned off. As long as the young stay away from the polling booths, the Harperites feel they are safe. However, it's clear that the future belongs to the politicians who can harness the energy of the young.

Tuesday, December 09, 2014

When Mike Harris became premier of Ontario, he appointed John Snoblen as his first Minister of Education. Ironically, Snoblen had dropped out of high school in grade 11 and never returned. His record not withstanding, he proclaimed that he was going to "reform" education. And the best way to do that, he said, was to "create a crisis." He proceeded to do just that.

When Stephen Harper came to Ottawa, Scott Clark and Peter Devries write, he followed in Snoblen's footsteps, even though he inherited a very healthy economy:

In 2006, the Conservative government inherited a structural surplus
of $13.8 billion, just under one per cent of GDP. This represented a
major correction from the $39.0 billion deficit (5.5 per cent of GDP)
Ottawa was carrying in 1992-93. The debt-to-GDP ratio had dropped
steadily from a high of 67.1 per cent in 1995-96 to 28.2 per cent in
2008-09. Program spending had fallen to a record low of 11.9 per cent of
GDP in 1999-00, down from a high of 17.0 per cent in 1992-93.

In other words, the heavy lifting was done already. Never before in
Canada had a newly elected government inherited a sustainable fiscal
structure — a structure that had produced 11 years of surpluses and a
declining debt burden. The fiscal situation could not have been better
for the Conservatives.

Harper, however, was obsessed with the idea that he was a better student of economics than his predecessors:

He had to prove his own budget bona fides. For that he would have to
find a ‘fiscal problem’ that he could fix with tough spending cuts and
public service layoffs — even if he had to manufacture one. If he could
do this, he could make ‘sound fiscal management’ his political brand. All he’d need would be a good ad campaign.

The first step was for Harper to adopt an approach that had been used
(unsuccessfully) by President Ronald Reagan in the U.S. — the ‘starve
the beast’ strategy. The idea — which, on paper, seemed very simple and
appealing — was to starve the government of revenue and then claim that,
because the resulting deficits were bad for the economy, government
programs and services would have to be cut to keep the debt in check. In
doing so (according to the theory), the ‘beast’ would shrink in size
and the private sector would become so deliriously happy as a result
that it would immediately ramp up investment and spur growth.

So much for theory. It wasn’t hard for the newly-elected Conservative
government to find a way to close the revenue taps in 2006. During the
election campaign they had promised to cut the GST by two points. Say
one thing for the Conservatives: They usually follow through on their
election promises — especially the bad ones. Had Mr. Harper targeted
income taxes instead of the GST, he could have claimed that he was
undertaking good tax policy by reducing a disincentive to work and make
money.

But good policy seldom wins out over good politics. The GST was the
riper political target, so the Conservative government cut the GST by
one point in 2006 and one point in 2007. That cost the government $14
billion annually. As a result of the GST cuts, the government recorded a
“structural deficit” of $5.8 billion in 2008-09 — down from a
“structural surplus” of $9.6 billion in the previous rear, a single-year
change of $15.4 billion. And that was before the 2008-09 recession had
even started.

And then the recession hit -- something both Harper and his finance minister, Jim Flaherty, said would not happen. But consider what would have happened if Harper and Flaherty had not cut the GST:

Without that loss of $14 billion in GST revenue, the deficit would have
been much smaller. Simply adding back the $14 billion would have given
us a deficit of $41.6 billion in 2009-10, $19.4 billion in 2010-11,
$12.3 billion in 2011-12 and $4.4 billion in 2012-13. There could even
have been a $9.2 billion surplus in in 2013-14 — two years
before the government’s deadline. Net debt would have increased by less
than $80 billion by 2015-16 — just over half the $150 billion
increase we’re expecting now.

John Snoblen knew nothing about education and Ontario is still trying to repair the damage he did. Imagine how much more damage Stephen Harper can do if he is re--elected.

Monday, December 08, 2014

It's interesting to consider the titles of bills that the Harper government steamrolls through parliament. Consider a few: The "Zero Tolerance for Barbaric Cultural Practices Act.” Or the "“Protection of Communities and Exploited Persons Act.” That's the new prostitution law. Or "The Black April Day Act." If you missed that one, Michael Harris reminds you that it:

created April 30 as the day to commemorate the diaspora of Vietnamese
citizens after Saigon fell to the Viet Cong in 1975. Thousands of those
refugees from South Vietnam came to Canada.

There is only one problem with dissing Vietnam with the Black April
Day Act. That country is now an important trading partner and a key ally
in the Trans Pacific Partnership negotiations. Vietnam’s ambassador
didn’t care much for the name of the private member’s bill or its
intent. So he decided to act. He asked to appear before the Senate
committee to air his concerns.

As reported by CP, he was turned down. The ambassador was then
invited to make a written submission. He complied. But while it was
being translated into French, the committee completed its “study” of the
bill and his objections were never formally considered. Nor were the
objections of any other witness who opposed the legislation.

Obviously, the act had nothing to do with the Vietnamese. It was all about firing up Harper's base:

Harper is merely driving in the wedges. He knows that the base doesn’t
like the idea of prostitution, so they will approve of the moralistic
bent of the Protection of Communities and Exploited Persons Act – and
send in $5. He knows that his Christian base also abhors polygamy, so
they will also send in $5 to support the Barbaric Cultural Practices
Act. And they will also send in $5 to support the Black April Day Act
because it is a reminder of the horrors of godless Communism.

And, as long as he can fire up his base -- and keep the opposition fighting about sexual harassment -- he'll continue to be prime minister.

Sunday, December 07, 2014

Except for the occasional episode of The Nature of Things, I don't watch CBC Television. But I do listen to Radio 1. The Gomeshi Affair has revealed deep seated problems at CBC Radio. So I read Noah Richler's piece in today's Toronto Star with interest. Richler writes:

There are many bright lights at the CBC and some very accomplished
journalists and perhaps even good managers, without question, but these
are up against the obdurate culture of an institution under siege.
Fighting to remain the same is not an option. Only radical change will save the place.

Great swathes of CBC
airtime are handed over to single people. You would think, listening to
CBC Radio, that only Eleanor Wachtel had ever read a decent foreign
novel; that Bob McDonald was our only adjudicator of science and that
Peter Mansbridge is the only person who can read the news.

Similarly,
Jian Ghomeshi was awarded every single trendy arts beat in the country
ad nauseam. Did we really need the allegations of his beating women to
discover that Rick Mercer could do the Scotiabank Giller job better?
Will the latter now do that show forever?

The point is that
there are huge numbers of qualified and entertaining Canadians ready to
be discovered that the CBC is shutting out by its reliance on just a few
people to do the work. Indeed, one of the pleasing effects of the
vacant seat at Q is that — as is ordinary, for instance, at the
BBC — the audience has been enjoying multiple hosts. It would be proper
for listeners to be treated to more of this, but this too is unlikely as
the CBC’s complacency in this regard is exacerbated by the tendency to
chase the grail of high ratings that celebrity brings to it in its
ailing state.

Unfortunately, CBC Radio has followed the American model. If Peter Jennings or Morley Safer could become stars south of the border, why not encourage that culture in Canadian broadcasting? The powers that be concluded that we no longer needed any more gravel voiced Norman DePoes, bespectacled Knowlton Nashes or non-photogenic Peter Gzowskis. Stars they weren't. But they were journalists first.

Saturday, December 06, 2014

With Industry Canada's approval of Burger King's takeover of Tim Horton's, Oakville officially became the home of the Whopper. But Gerald Caplan writes that the real home of the Whopper is Ottawa. And, while several past governments might lay claim to telling the biggest whoppers, the Harper government is certainly in the running for the gold medal:

But last week the government finally won the gold medal for perhaps the
most despicable act ever of deceit and outright lying. And wouldn’t you
just know, given the Harper record, that it was Canada’s veterans they
lied to.

Stephen Harper and his government have seemed inexplicably indifferent
to vets returning from war zones with post-traumatic stress disorder.
According to the latest Defence Department stats, 160 military personnel
committed suicide between 2004 and March 31, 2014. That compares to the
138 Canadian soldiers killed
in combat in Afghanistan between 2002 and 2014. It’s a stunning
comparison, isn’t it? By any measure it’s a crisis of epidemic
proportions, and yet the government refused to take it seriously.
Rhetoric? Of course; a great deal. Money? Some. Yet no serious attempt
to deal with the problem. It’s truly baffling.

So, two days before the auditor general lambasted the Harperites for the delays in getting services to the victims of PTSD, Julian Fantino announced that $200 million dollars were going to be spent on providing those services. However:

The $200-million money is not for the next six years at all. It’s for
the next 50 years, as the government was soon forced to acknowledge,
maybe $4-million a year. According to Scott Maxwell, executive director
of the activist Wounded Warriors Canada, the 50-year figure “has never
been mentioned in any briefing, in any press release or conference.” The
government wilfully covered up the truth from beginning to end.

Friday, December 05, 2014

The opposition parties are calling for Julian Fantino's resignation. It's true that Fantino has bungled every cabinet position he's held. But he has never run any ministry for which he has been held responsible. Michael Harris writes:

No Harper cabinet minister runs his or her department.
Fantino does what every other cabinet minister does — exactly what he’s
told to do by the PMO. He did what he was told as minister of state for
Seniors, as associate minister of Defence, as minister for International
Cooperation, and as the dud champ of the vets. A click of the heels, a
salute — and then its off to fire another snowball made by Stephen
Harper.

Harper doesn’t fire people for doing what they’re told — which is why
Fantino still has his job. Nor has the PM ever had a problem with
sending a bricklayer to repair a Rolex. In fact, Harper has used
Fantino’s tough-guy/ex-cop image in every one of his postings to “scare
the ‘crats” internally, as one insider put it — the “‘crats” being
bureaucrats. Since Harper is still persuaded the public service is an
enemy, Fantino performs a very useful service.

It's Harper who has dismantled Veterans Affairs. Consider the numbers:

It’s Harper who is downsizing Veterans Affairs. It’s Harper who
removed $226 million from VA, or nearly 30 per cent of its operational
budget, in just two years. It’s Harper who thinks massive job cuts at VA
— 1,000 so far — amount to nothing more than the culling of backroom
nobodies.

Finally, it’s the PM who has such a shallow understanding of the
nature of Post Traumatic Stress Disorder that he thinks any vet
suffering from it can get help at Service Canada Centres — the places
you go to apply for Employment Insurance or maternity benefits.

And to cover the damage, there is the usual response -- advertise:

Those ads will have to be pretty good this time. They’ll have to make
people forget all about the unspent $1.13 billion the Harper government
has siphoned from Veterans Affairs since 2006. They’ll have to convince
Canadians to overlook the fact that Harper has cut 25 per cent of the
workforce at Veterans Affairs in the past five years. As reported by
Paul McLeod of the Chronicle Herald, half of those cuts were made to a program called Health Care and Re-Establishment benefits.

Fantino may be a tough talking fool. But the real villain is Stephen Harper.

Thursday, December 04, 2014

Some commentators have suggested that, after the Michael Sona trial, no political party would be stupid enough to try any robocall shenanigans. Linda McQuaig has her doubts:

If you’re a low-level political operative, the conviction of
Conservative party staffer Michael Sona for his role in the robocall
scandal may well have deterred you from committing voter fraud in the
future.

But if you’re a high-level political operative, the outcome of Sona’s trial probably left you emboldened.

After all, even though one judge concluded that there was deliberate organization behind the effort to misdirect voters, and another judge concluded that Michael Sona could not have acted alone, the Harperites managed to shut the whole investigation down:

Certainly, the Conservatives seem to have dodged a bullet. After
months of investigation and court proceedings into allegations of an
organized attempt to send non-Conservatives to the wrong polling
stations on election day in May 2011, the party itself has emerged with
(technically) clean hands.

Blame for the scandal was meted out solely to Sona, the former party
operative in Guelph who was sentenced to nine months imprisonment and released on bail this week.

And with the "Fair" Elections Act now in place, they have made sure that there will be no further investigations:

That’s because the government’s controversial election reform package
includes a section that prevents the Commissioner of Elections from
revealing any details about investigations being conducted by Elections
Canada.

The robocalls came to light only because, after receiving complaints
of electoral irregularities (primarily involving Guelph), the
Commissioner of Elections began to investigate and filed a court
application related to that investigation. After the details of the
application were picked up by the media, there was a flood of complaints
from citizens across the country reporting they received similar
misleading phone calls on election day.

Had the new “muzzling” rule been in place,
the application filed by the Commissioner would have been sealed,
preventing the public from knowing about the initial investigation — the
trigger that prompted the nationwide response, allowing the public to
see a larger pattern of possible voter suppression.

There is a method to their madness. And make no mistake. It's madness.

Wednesday, December 03, 2014

The Robert Reich documentary, Inequality For All explains with remarkable clarity what has happened in the United States over the last forty years and in Canada over the last thirty years. Reich argues that the economy will implode unless there is a fairer distribution of income between citizens. That idea is beginning to percolate in Canada. Carol Goar writes:

But continuing to neglect the problem will allow the top 0.01 per cent
of the population to skim off an ever larger share of the national
income at the expense of everyone else. It will leave most of the
electorate with no stake in the country’s collective success. And it
will deepen the sense of unfairness hard-working Canadians already feel.

Even banks and
business-friendly think-tanks recognize the danger. In a special report
last week, the Toronto Dominion Bank urged the government to “lean against income inequality.” A day later, the C.D Howe Institute devoted its annual Benefactors Lecture to rewriting the tax code to restore fairness and give Canada’s next generation a chance.

And, taking his cue from Reich, Kevin Milligan has suggested that several changes need to be made to the way Canadians are taxed:

First, get rid of all the loopholes,
starting with the “boutique tax credits” that have proliferated under
Prime Minister Stephen Harper. The list includes the children’s fitness
tax credit, the green renovation tax credit, the volunteer firefighting
tax credit, the public transit tax credit, the tradespersons’ tool tax
deduction, the tuition tax credit, university textbook tax credit, the
working income tax credit, the video production tax credit and the adult
gym membership tax credit and the search-and-rescue tax credit. “These
credits are inefficient and they’re biased toward higher earners,”
Milligan said.

Second, apply the
same tax rate to all forms of investment income: dividends, capital
gains and interest payments. Milligan contends this would simplify the
system and get badly needed capital into the hands of entrepreneurs and
innovators with the potential to go global.

Third — and most
controversially — move to a dual income tax system. There would be one
flat rate for all forms of capital income, but a more steeply
progressive rate structure for employment income. This would include two
new tax brackets
at the top: one for those with incomes of $250,000 or more (32 per
cent), the second for those making $400,000 or more (35 per cent). This,
coupled with the closing of tax loopholes, would leave the hyper-rich
with fewer ways to escape paying their share of the tax burden.

Goar admits that there are problems with Milligan's proposals. Most Canadians don't have capital income, so the system would still be tilted in favour of the rich. But Milligan would put an end to the tax cuts that have bought Stephen Harper votes. And the rich would pay more of their fair share.

And, until we stop buying the canard that the rich create jobs, we're heading for disaster.

Tuesday, December 02, 2014

Stephen Harper hopes to be re-elected on his boast that he knows -- better than anyone else -- how to manage the Canadian economy. But the evidence keeps suggesting that he doesn't know what he's doing. Murray Dobbin writes:

However you see it -- as separate from society or integral to it --
Canada's "economy" is increasingly at the mercy of a risk-averse, inept
corporate elite addicted to government tax breaks, and an ideologically
addled government which more than anything else is simply incompetent.
It is a deadly combination -- a sort of dumb and dumber team slowly
dragging us backwards at a time when the world is just hoping there
won't be another economic collapse.

Consider our sliding position among OECD countries:

An OECD study reported in the Globe shows that Canada has
dropped out of the top 10 in R&D spending and now ranks 12th. While
we de-industrialize and fall back on raw resource exports, previously
underdeveloped countries -- Taiwan, Indian and Brazil -- are now
outspending us as they industrialize.

We continue to decline in the World Economic Forum's World Competitiveness Index
as well. For 2014-2015 we rank 15th. But even worse, in the category of
"innovation and sophistication factors" we rank 25th. In 1998 our
overall rank was sixth. Some of the countries that now beat us: the
United Arab Emirates, Taiwan, Hong Kong and Singapore. The dramatic
decline in R&D has a continuing negative impact on labour
productivity as well. According to OECD figures,
for the year 2012 we stood at 73 per cent of the U.S. benchmark of 100.
This failure to increase labour productivity through investment in new
machinery and innovation has a huge impact on our standard of living and
the domestic economy: as wages stagnate and personal debt increases
domestic consumption starts to flat-line -- and that further suppresses
investment.

And, while Harper trumpets his trade deal with Europe, India isn't even on his radar:

The other media report
that reveals the pathetic level of government and corporate leadership
on the economy focused on our complete failure to look to India as a
potent export market. It is the fastest-growing economy on the planet
yet Canadian corporations and their government partners seem asleep at
the switch. Kevin Carmichael in the Globe and Mail quotes the
president of Canada-India Business Council: "We've got to get in here
fast or we're going to miss the boat. You've seen a rush to the gates
[from other nations]. We seem to be taking a slow walk." Currently exports to India
account for a minuscule 0.63 per cent of Canadian exports -- and 45 per
cent of that is raw materials. Canada scarcely does better in other
emerging nations. Of our top three destinations for goods, the U.S.
takes 74.5 per cent, China 4.3 per cent and the U.K. 4.1 per cent.
Australia, a Pacific nation we compete with, is far more diversified in
its export destinations: China 29.5 per cent, Japan 19.3 per cent, South Korea 8 per cent, India 4.9 per cent.

The only thing that Mr. Harper is focused on is getting Canadian oil to foreign markets. But it's becoming apparent that Alberta bitumen simply costs too much to produce. And its overall economic benefits are miniscule:

Frances Russell highlighted
the fact that "Canada's energy sector created only 1.7 per cent of all
new jobs in Canada from 2007 to 2012." That was just 13,000 jobs.
Compare that to the 22,000 jobs created in a single month, December
2013, in health care and social assistance. "The energy sector accounts
for only 0.1 percentage point of the average 2.25 per cent annual GDP
growth over the last decade," according to the IMF. As for the alleged
benefits accruing to other provinces, a dollar invested in the tar sands
boosts manufacturing in the rest of Canada by three cents and GDP in
Ontario by four cents. And if none of the pipelines from the tar sands
were built? The economy would grow 0.5 per cent less by 2020.

If you look at the numbers, it begins to dawn on you. If you buy Stephen Harper's vision of the Canadian economy, you're buying a pig in a poke.

About Me

A retired English teacher, I now write about public policy and, occasionally, personal experience. I leave it to the reader to determine if I practice what I preached to my students for thirty-two years.